Local governance indicator

Abstract

Over the last 15 years, most of the World Bank studies have focused on development of standards governance indicators which do not take into consideration the realities of developing countries such as Tunisia. Many countries have adopted these indicators to measure their governance quality. Yet none, to our knowledge, has attempted to define its local governance indicators. The purpose of this study is to show the need for developing a local governance indicator. The following variables have been selected: contract intensive money, foreign direct investment, scientific and technical articles produced and budgetary policy of the State to elaborate a local governance indicator. Our results indicate that governance variables affect economic growth. According to our results, improving the financial sector, scientific research and State spending policy can enhance economic growth.